Business Profitability Calculator
Profit Margin Calculator
Calculate gross profit, gross margin, operating profit, operating margin, total costs, and a simplified break-even revenue level for your business.
Business Financial Inputs
Enter your revenue and major business costs to estimate gross and operating profitability.
Results
Gross Profit
$60,000
Gross Margin
60.00%
Operating Profit
$30,000
Operating Margin
30.00%
Total Costs
$70,000
At this simplified level, revenue equal to total costs represents the break-even revenue before taxes, financing costs, and other adjustments.
Profit Margin Formula
Gross margin = gross profit ÷ revenue × 100. Operating margin = operating profit ÷ revenue × 100.
Next step
Turn pricing math into scenarios
Compare pricing scenarios, plan for target profit, and test margin changes in one workflow.
01
Calculate
Start with a focused business question and get a clear estimate.
02
Compare
Move from one answer to multiple assumptions and scenarios.
03
Plan
Save useful scenarios in your workspace and build on them later.
How to calculate profit margin
Profit margin measures how much profit remains from revenue after accounting for specified costs. Gross margin focuses on revenue after cost of goods sold, while operating margin also accounts for operating expenses.
Gross margin vs. operating margin
Gross margin can help show how efficiently a business produces or delivers what it sells. Operating margin goes further by including operating expenses such as payroll, rent, software, marketing, and other overhead included in the calculation.
Example
Suppose a business generates $100,000 in revenue, has $40,000 in cost of goods sold, and has $30,000 in operating expenses. The calculator estimates $60,000 of gross profit and $30,000 of operating profit.
What should you do after calculating your margin?
Profit margin is one part of a larger business analysis. Compare your margin with break-even requirements, evaluate potential financing costs, or test how changes in revenue and expenses could affect your business.
This calculator provides estimates based on the information you enter. Actual profitability can differ based on taxes, financing, depreciation, accounting treatment, one-time expenses, and other business factors.